Self-employed and side hustle tax calculator

Taxable profit is your income minus allowable business expenses. It is taxed at the same rates as salary: 20% up to £50,270 of total income, 40% to £125,140 and 45% above, with the Personal Allowance tapered between £100,000 and £125,140. Class 4 National Insurance is 6% on profits between £12,570 and £50,270 and 2% above. Class 4 is worked out on your self-employed profit alone, so a salary does not use up the 6% band.

The first £1,000 of trading income each year is tax-free, and if your gross trading income is £1,000 or less you do not need to tell HMRC. Above that, you can deduct either the £1,000 allowance or your actual expenses, whichever is higher. The calculator picks the better option automatically.

For the 2026/27 tax year, register by 5 October 2027 if you are new to Self Assessment, and file and pay by 31 January 2028. If your bill is over £1,000 and less than 80% of your tax was collected at source, HMRC also asks for two payments on account towards the next year, each half of this year's bill, due on 31 January and 31 July. In your first year that can mean paying 150% of a year's tax in one January, so set money aside as you earn it.

Making Tax Digital for Income Tax requires quarterly updates through compatible software. It applies from 6 April 2026 if your self-employed and property income (turnover, before expenses) was over £50,000, from April 2027 over £30,000, and from April 2028 over £20,000. Your salary does not count towards these thresholds.

Profits above the small profits threshold of £7,105 in 2026/27 earn a qualifying year for the State Pension without paying anything extra. Below that, and with no job that earns a qualifying year, you can pay voluntary Class 2 contributions of £3.65 a week to protect your record.